Australia and China have achieved a major breakthrough on trade impediments, agreeing on a pathway forward to end the dispute over barley imports.

The Australian government has paused its World Trade Organisation dispute levelled against China for imposing the tariffs.

In return, Beijing will conduct an expedited review of the tariffs in the next three to four months. The WTO case will resume after that only if no agreement is reached.

“We believe there’s no justification for the measures that China introduced in relation to barley,” Foreign Minister Penny Wong said.

“We have also made clear that we believe it is in both countries’ interests for these trade impediments to be removed.”

Senator Wong said the Albanese government was seeking to expedite a resolution in the ongoing dispute. Any agreement could pave the way for the removal of trade barriers imposed against other Australian products, such as wine and seafood.

“This would potentially deliver a result in a shorter timeframe than if we simply proceeded through the WTO,” Senator Wong said.

“Obviously, stabilisation and the resolution of trade issues will take time, but we are pleased that constructive dialogue has resumed.

But she said Australia would continue to work within the WTO to “protect and preserve” the rights of its exports.

China slapped tariffs of up to 80 per cent on Australian grain nearly three years ago. The move triggered alarm among exporters, who predicted it could cost Australian farmers up to $500 million a year.

China said at the time the tariffs were the culmination of an 18-month-long investigation into an anti-dumping complaint. However, the announcement also followed public calls by the then Morrison government for an independent inquiry into the origins of the coronavirus.

On Tuesday, Trade Minister Don O’Farrell said he hoped resolution of the barley dispute would be “a template for them moving on to the other areas of dispute, and in particular, Australian wine”.

“We are hopeful that at the end of that review process, that the impediments that currently exist will be suspended and removed and we can get back to normal trade with China,” he said.

Grain Producers Australia Chair, Barry Large, backed the government’s strategy.

“Barley is an important rotation crop for Australian growers and any optimism on the future outlook is good,” he told the ABC.

“This process to reach a resolution would be significantly shorter than if the WTO process continued.”

China remains Australia’s largest trading partner, worth some $300 billion last year.

-with AAP